From News.com:
Lawyers representing the entertainment industry and file-swapping companies will meet in Pasadena, Calif., on Tuesday as a federal appeals court hears the first arguments in a case likely to shape the future of online file swapping.
The 9th U.S. Circuit Court of Appeals is reviewing a lower court decision made last spring in which a federal judge ruled that distributing decentralized file-swapping tools such as Grokster and Morpheus was legal, and that their parent companies bore no legal liability for copyright infringement occurring on those networks.
The ruling was a surprise setback for record labels and Hollywood studios, which had previously won rulings forcing Napster and other file-swapping companies to close, and had expected the same result against Grokster and Morpheus parent Streamcast Networks. Those companies, now defending their win in the higher court, say the issue is bigger than their products, or even the file-swapping industry.
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